ING Investment Management will look to rebuild its team following the defection of three of its small cap portfolio managers to rival house Credit Suisse Asset Management (CSAM).
On Friday, CSAM announced that Issam Eid, Steven NG and Rajeev de Silva will join its small companies team. All three were members of ING's Australian equities team and were responsible for the Small Companies Fund.
CSAM also announced that it had hired Stephen Giubin as head of its Australian equities team.
As a result of the departures, responsibility for ING's small cap portfolio will be re-allocated across its Australian equities team with co-head of Australian equities Mark East resuming primary responsibility for the management of the small caps portfolio.
ING's Australian equities team manages $10.7 billion in funds under management of which $450 million is managed through the small caps portfolio.
"ING obviously will have to look at new resources in order to build that small cap capability. The manager still, however, has quality manager, Mark East to manage the portfolio in the interim," Lonsec general manager Grant Kennaway said.
"What is really intriguing is the fact that these small cap managers went to another fund manager rather than setting up their own boutique."
Clearly the people of ING are taking care of the portfolio and the resources are sufficient to maintain coverage, Morningstar head of research Anthony Serhan said. The key issue, however, is who ING will bring in and how they are going to structure the portfolio going forward, he said.
A CSAM spokesperson said that Andrew Fleming, who had managed CSAM's small cap strategy, will leave the firm in June.
Fleming, who had managed CSAM's large cap strategy, was brought in to manage the small-cap strategy for the manager. The appointment was as an interim measure following the departure of small-cap portfolio managers Stephen Atkinson and Matthew Booker in early 2007.
"While the hires are a start for CSAM. This is more than a small cap issue, the real question is how Giubin will structure the overall Australian equities research effort," Serhan said.
